We review the carrying value of our long-lived assets (primarily property and equipment and intangible assets) to assess the recoverability of these
assets when indicators of impairment occur. We record impairment losses on long-lived assets used in operations when events and circumstances indicate that the assets might be impaired and the undiscounted cash flows estimated to be generated by
those assets are less than the carrying amount of those assets. Impairment is measured based on the fair market value of the affected asset using discounted cash flows.

As of December 31, 2006, we determined an impairment charge of $0.4 million was required based
upon the analysis of unfavorable preliminary data from our U.S. clinical study of the Expedial Vascular Access Graft. As a result of our review, we decided to forego further enrollment in the clinical study and cease the production and sales of this
device. During the second quarter of 2006, we determined that the future cash flows from the related patents and equipment were less than their carrying value. Fair value was determined by prices of similar products. Consequently, impairment charges
to reduce the carrying value of these assets to fair value and related inventory to net realizable value totaled $0.7 million, of which $0.3 million related to the impairment of other intangible assets relating to the Expedial product line
patents, approximately $64,000 related to the write-down of related production equipment, and $0.3 million related to inventory write-offs that were charged to cost of sales. During the fourth quarter of 2006, we sold certain manufacturing
equipment, inventory, and intellectual property related to the Expedial Vascular Access Graft product line to CardioTech International, Inc., now known as Advansource Biomaterials Corporation, for total consideration of $0.4 million plus a 5 percent
royalty on the net sales of its CardioPass brand coronary artery bypass graft for a period of five years following the first commercial sale of a CardioPass graft. The CardioPass graft is in pre-commercial clinical trials in Europe, and there can be
no assurance that it will ever be commercialized. As a result of the sale, we subsequently adjusted the initial impairment charge for $0.3 million for the gain on the sale of the intellectual property and equipment resulting in a net impairment
charge of $0.1 million. The sale of inventory resulted in an adjustment to cost of sales for $12,000.

In January 2008 we were notified by
one of the customers of our Biomateriali subsidiary that they would no longer purchase a certain product line from us, and, as a result, we incurred an impairment charge of $0.4 million due to the write-down of related intangible assets. As of
December 31, 2008, we determined that an impairment indicator existed with respect to the remaining product line with this Biomateriali customer. Consequently, we recorded an impairment charge of $84,000 to reduce the carrying value of these
assets to fair value to net realizable value of $0.1 million. Fair value was determined by projected future cash flows discounted to their net present value. In 2008, we also recognized impairment charges of $78,000 related to patents and trademarks
which were deemed to have no value based upon a lack of future expected economic benefits.

Impairment of Long-lived Assets

We review the carrying value of our long-lived assets (primarily property and equipment and intangible assets) to assess the recoverability of these
assets when indicators of impairment occur. We record impairment losses on long-lived assets used in operations when events and circumstances indicate that the assets might be impaired and the undiscounted cash flows estimated to be generated by
those assets are less than the carrying amount of those assets. Impairment is measured based on the fair market value of the affected asset using discounted cash flows.

As of December 31, 2006, we determined an impairment charge of $0.4 million was required based
upon the analysis of unfavorable preliminary data from our U.S. clinical study of the Expedial Vascular Access Graft. As a result of our review, we decided to forego further enrollment in the clinical study and cease the production and sales of this
device. During the second quarter of 2006, we determined that the future cash flows from the related patents and equipment were less than their carrying value. Fair value was determined by prices of similar products. Consequently, impairment charges
to reduce the carrying value of these assets to fair value and related inventory to net realizable value totaled $0.7 million, of which $0.3 million related to the impairment of other intangible assets relating to the Expedial product line
patents, approximately $64,000 related to the write-down of related production equipment, and $0.3 million related to inventory write-offs that were charged to cost of sales. During the fourth quarter of 2006, we sold certain manufacturing
equipment, inventory, and intellectual property related to the Expedial Vascular Access Graft product line to CardioTech International, Inc., now known as Advansource Biomaterials Corporation, for total consideration of $0.4 million plus a 5 percent
royalty on the net sales of its CardioPass brand coronary artery bypass graft for a period of five years following the first commercial sale of a CardioPass graft. The CardioPass graft is in pre-commercial clinical trials in Europe, and there can be
no assurance that it will ever be commercialized. As a result of the sale, we subsequently adjusted the initial impairment charge for $0.3 million for the gain on the sale of the intellectual property and equipment resulting in a net impairment
charge of $0.1 million. The sale of inventory resulted in an adjustment to cost of sales for $12,000.

In January 2008 we were notified by
one of the customers of our Biomateriali subsidiary that they would no longer purchase a certain product line from us, and, as a result, we incurred an impairment charge of $0.4 million due to the write-down of related intangible assets. As of
December 31, 2008, we determined that an impairment indicator existed with respect to the remaining product line with this Biomateriali customer. Consequently, we recorded an impairment charge of $84,000 to reduce the carrying value of these
assets to fair value to net realizable value of $0.1 million. Fair value was determined by projected future cash flows discounted to their net present value. In 2008, we also recognized impairment charges of $78,000 related to patents and trademarks
which were deemed to have no value based upon a lack of future expected economic benefits.

Impairment of Long-lived Assets

STYLE="margin-top:6px;margin-bottom:0px; text-indent:4%">We review the carrying value of our long-lived assets (primarily property and equipment and intangible assets) to assess the recoverability of theseassets when indicators of impairment occur. We record impairment losses on long-lived assets used in operations when events and circumstances indicate that the assets might be impaired and the undiscounted cash flows estimated to be generated bythose assets are less than the carrying amount of those assets. Impairment is measured based on the fair market value of the affected asset using discounted cash flows.

As of December 31, 2006, we determined an impairment charge of $0.4 million was required basedupon the analysis of unfavorable preliminary data from our U.S. clinical study of the Expedial Vascular Access Graft. As a result of our review, we decided to forego further enrollment in the clinical study and cease the production and sales of thisdevice. During the second quarter of 2006, we determined that the future cash flows from the related patents and equipment were less than their carrying value. Fair value was determined by prices of similar products. Consequently, impairment chargesto reduce the carrying value of these assets to fair value and related inventory to net realizable value totaled $0.7 million, of which $0.3 million related to the impairment of other intangible assets relating to the Expedial product linepatents, approximately $64,000 related to the write-down of related production equipment, and $0.3 million related to inventory write-offs that were charged to cost of sales. During the fourth quarter of 2006, we sold certain manufacturingequipment, inventory, and intellectual property related to the Expedial Vascular Access Graft product line to CardioTech International, Inc., now known as Advansource Biomaterials Corporation, for total consideration of $0.4 million plus a 5 percentroyalty on the net sales of its CardioPass brand coronary artery bypass graft for a period of five years following the first commercial sale of a CardioPass graft. The CardioPass graft is in pre-commercial clinical trials in Europe, and there can beno assurance that it will ever be commercialized. As a result of the sale, we subsequently adjusted the initial impairment charge for $0.3 million for the gain on the sale of the intellectual property and equipment resulting in a net impairmentcharge of $0.1 million. The sale of inventory resulted in an adjustment to cost of sales for $12,000.

In January 2008 we were notified byone of the customers of our Biomateriali subsidiary that they would no longer purchase a certain product line from us, and, as a result, we incurred an impairment charge of $0.4 million due to the write-down of related intangible assets. As ofDecember 31, 2008, we determined that an impairment indicator existed with respect to the remaining product line with this Biomateriali customer. Consequently, we recorded an impairment charge of $84,000 to reduce the carrying value of theseassets to fair value to net realizable value of $0.1 million. Fair value was determined by projected future cash flows discounted to their net present value. In 2008, we also recognized impairment charges of $78,000 related to patents and trademarkswhich were deemed to have no value based upon a lack of future expected economic benefits.

We review the carrying value of our long-lived assets (primarily property and
equipment and intangible assets) to assess the recoverability of these assets when indicators of impairment occur. We record impairment losses on long-lived assets used in operations when events and circumstances indicate that the assets might be
impaired and the undiscounted cash flows estimated to be generated by those assets are less than the carrying amount of those assets. Impairment is measured based on the fair market value of the affected asset using discounted cash flows.

As of December 31, 2006, we determined an impairment charge of $0.4 million was required based upon the analysis of unfavorable
preliminary data from our U.S. clinical study of the Expedial Vascular Access Graft. The preliminary clinical data suggested that the device may not compare favorably to ePTFE grafts. As a result of our review of the clinical study results, we
decided to forego further enrollment in the clinical study and cease the production and sales of this device. During the second quarter of 2006, we determined that the future cash flows from the related patents and equipment were less than their
carrying value. Fair value was determined by prices of similar products. Consequently, impairment charges to reduce the carrying value of these assets to fair value and related inventory to net realizable value totaled $0.7 million, of which
$0.3 million related to the impairment of other intangible assets relating to the Expedial product line patents, approximately $64,000 related to the write-down of related production equipment, and $0.3 million related to inventory write-offs
that were charged to cost of sales. During the fourth quarter of 2006, we sold certain manufacturing equipment, inventory, and intellectual property related to the Expedial Vascular Access Graft product line to CardioTech International,

Inc., for total consideration of $0.4 million plus a 5 percent royalty on CardioTechs net sales of its CardioPass brand coronary artery bypass graft
for a period of five years following the first commercial sale of a CardioPass graft. The CardioPass graft is not yet in clinical trials, and there can be no assurance that it will ever be commercialized. As a result of the sale, we subsequently
adjusted the initial impairment charge for $0.3 million for the gain on the sale of the intellectual property and equipment, which is recorded as an adjustment to restructuring charges, and adjusted cost of sales for $12,000 for the inventory sale.

The Company reviews the carrying value of its long-lived assets (primarily property and equipment and intangible assets) to assess the recoverability of
these assets when indicators of impairment occur. The Company records impairment losses on long-lived assets used in operations when events and circumstances indicate that the assets might be impaired and the undiscounted cash flows estimated to be
generated by those assets are less than the carrying amount of those assets. Impairment is measured based on the fair market value of the affected asset using discounted cash flows.

During the second quarter of 2006, the Company determined that an impairment charge of $0.4 million was required based upon the analysis of
unfavorable preliminary data from its U.S. clinical study of the Expedial Vascular Access Graft. As a result of the Companys review of the preliminary clinical data, the Company decided to forego further enrollment in the clinical study and
ceased the production and sale of this device. The Company determined that the future cash flows from the related patents and equipment

were less than their carrying value based on fair value determined by prices of similar products. Consequently, impairment charges to reduce the carrying
value of these assets to fair value and related inventory to net realizable value totaled $0.7 million. Of this amount, $0.3 million related to the impairment of other intangible assets relating to the Expedial Vascular Access Graft product
line patents, approximately $64,000 related to the write-down of related production equipment and $0.3 million related to inventory write-offs charged against cost of sales.

The Company reviews the carrying value of its long-lived assets (primarily property and equipment and intangible assets) to assess the recoverability of
these assets when indicators of impairment occur. The Company records impairment losses on long-lived assets used in operations when events and circumstances indicate that the assets might be impaired and the undiscounted cash flows estimated to be
generated by those assets are less than the carrying amount of those assets. Impairment is measured based on the fair market value of the affected asset using discounted cash flows.

During the second quarter of 2006, the Company determined that an impairment charge of $0.4 million was required based upon the analysis of
unfavorable preliminary data from its U.S. clinical study of the Expedial Vascular Access Graft. As a result of the Companys review of the primarily clinical data, the Company decided to forego further enrollment in the clinical study and
cease the production and sales of this device. The Company determined that the future cash flows from the related patents and equipment were less than their carrying value. Fair value was determined by prices of similar products. Consequently,
impairment charges to reduce the carrying value of these assets to fair value and related inventory to net realizable value totaled $0.7 million of which $0.3 million related to the impairment of other intangible assets relating to the Expedial
Vascular Access Graft product line patents, approximately $64,000 related to the write-down of related production equipment and $0.3 million related to inventory write-offs charged against cost of sales.

The Company reviews the carrying value of its long-lived assets (primarily property and equipment and intangible assets) to assess the recoverability of
these assets when indicators of impairment occur. The Company records impairment losses on long-lived assets used in operations when events and circumstances indicate that the assets might be impaired and the undiscounted cash flows estimated to be
generated by those assets are less than the carrying amount of those assets. Impairment is measured based on the fair market value of the affected asset using discounted cash flows.

As of December 31, 2006, the Company determined an impairment charge of $0.4 million was required based upon the analysis of unfavorable
preliminary data from its U.S. clinical study of the Expedial Vascular Access Graft. The preliminary clinical data suggested that the device may not compare favorably to ePTFE grafts. As a result of the Companys review of the clinical study
results, the Company decided to forego further enrollment in the clinical study and cease the production and sales of this device. During the second quarter of 2006, the Company determined that the future cash flows from the related patents and
equipment were less than their carrying value. Fair value was determined by prices of similar products. Consequently, impairment charges to reduce the carrying value of these assets to fair value and related inventory to net realizable value totaled
$0.7 million of which $0.3 million related to the impairment of other intangible assets relating to the Expedial product line patents, approximately $64,000 related to the write-down of related production equipment, and $0.3 million
related to inventory write-offs charged against cost of sales. During the fourth quarter of 2006, the Company sold certain manufacturing equipment, inventory and intellectual property related to the Expedial Vascular Access Graft product line to
CardioTech International, Inc. for total consideration of $0.4 million plus a five percent royalty on CardioTechs net sales of its CardioPass brand coronary artery bypass graft for a period of five years following the first commercial sale of
a CardioPass graft. The CardioPass graft is not yet in clinical trials and there can be no assurance that it will ever be commercialized. As a result of the sale, the Company subsequently adjusted the initial impairment charge for $0.3 million for
the gain on the sale of the intellectual property and equipment, which is recorded as a adjustment to restructuring charges and adjusted $12,000 against cost of sales for the inventory sale.